Bracing for fresh US trade bans, Huawei is making contingency plans, increasing purchases of third-party mobile application processors for its 5G smartphones, according to Digitimes Research, as it looks to maintain its product competitiveness, stable supply and profitability. Apple, one of Huawei's major rivals in the smartphone space, is set to launch its 5G iPhones later than usual. PCB suppliers expect to see their shipments peak for the new iPhones in fourth quarter 2020. TSMC, a major foundry service supplier for Apple and many other device vendors, has offered a rosy outlook for its business in second-half 2020. TSMC's materials and equipment suppliers are set to see strong results as well. Huawei diversifying purchases of 5G APs: Huawei is increasing the proportion of mobile application processors (APs) from third-party suppliers for its smartphones, reducing use of Kirin chips from its subsidiary HiSilicon Technologies, as a contigency against the US trade ban, according to Digitimes Research.PCB shipments for new iPhones to peak in 4Q20, say sources: Taiwan's PCB makers in the supply chain for Apple devices will see their shipments for new iPhones not peak until the fourth quarter this year as Apple has confirmed its iPhone 12 lineup will debut later than normally scheduled in September, according to industry sources.Silicon wafer materials and equipment suppliers see orders pull in from TSMC: With TSMC scaling up its 7nm and 5nm chip output, related silicon wafer materials and equipment suppliers have seen significant orders from the pure-play foundry and are ramping up their shipments to fulfill the new orders.

Global shipments of AIO (all-in-one) PCs increased 28.7% sequentially to three million units in the second quarter of 2020 thanks to fulfillment of orders deferred from the first quarter by production disruptions amid the coronavirus outbreak. But AIO PC shipments are expected to see a sequential growth of only 4% in the third quarter as notebooks have become mainstream models for remote work and education applications, according to Digitimes Research.With shipments of other desktop PCs losing momentum amid economic downturns, the ratio for AIO PCs among overall shipments of desktops rose to 15% in the second quarter and is expected to advance further in the third quarter.HP saw its AIO PC shipment volume outstrip other vendors in the second quarter due partly to fulfilling the most deferred shipments and partly to replacement demand. HP and Lenovo together commanded over 50% of the global AIO PC shipments in the second quarter.HP will see a slowdown in its AIO PC sales in the third quarter, but Apple is expected to sustain its sales momentum in the quarter thanks partly to its launch of new offerings, with its shipments likely to reach the same level as HP's.Among AIO PC ODMs, Quanta Computer saw its second-quarter shipments surge 56% sequentially on drastic increases in shipments to HP and Apple, with its global market share rising to over 40%.Wistron's second-quarter shipments posted an even higher sequential increase of 80%, driven by strong momentum for shipments to HP, Acer and Lenovo.Compal Electronics witnessed second-quarter shipments expand 37% sequentially on increased orders from Lenovo and Asustek.Both Quanta and Compal are expected to register sequential growths of over 10% in third-quarter AIO PC shipments, according to Digitimes Research.

Huawei is increasing the proportion of mobile application processors (APs) from third-party suppliers for its smartphones, reducing use of Kirin chips from its subsidiary HiSilicon Technologies, as a contigency against the US trade ban, according to Digitimes Research.Multiple sourcing for mobile APs is a necessity for Huawei to maintain its product competitiveness, stable supply and profitability, and the Chinese vendors is likely to add 1-2 vendors to its supplier list for smartphone APs.While Taiwan-based MediaTek is already a third-party 5G AP supplier for Huawei, the possibility is high for the Chinese vendor to also purchase 5G APs from Qualcomm if the US chipmaker is able to obtain a US license to ship to Huawei.Huawei has ramped its purchases of MediaTek's midrange Dimensity 800 5G SoCs for the production of its Enjoy and Honor smartphones since the second quarter of 2020 and may also start buying MediaTek's high-end 5G APs in second-half 2020 and 2021.Digitimes Research has found that Qualcomm were selling more of its premium Snapdragon 865 APs than MediaTek's Dimensity 1000 chips in China in the first half of 2020 thanks to its brand and product image.Samsung Electronics and China's Unisoc Technologies could also be alternative sources of 5G APs for Huawei, but the two firms will face challenges for selling chips to the Chinese top smartphone vendor. Samsung is a strong competitor of Huawei in the global smartphone market, while Unisoc still lags other rivals in terms of technology development.Shipments of 5G phones in the China market are expected to reach over 170 million units in 2020 and will continue to grow in 2021.

The ultimate purpose of applying IoV (Internet of vehicle) to urban traffic is to maximize its efficiency, according to Thomas Stein, CEO for the Taiwan branch of Siemens Mobility.Software/hardware transportation solutions are like building blocks that are deployed around cities and connected based on various scenarios of using roads, Stein said.Because of limited physical properties, onboard sensors cannot detect abruptly appearing objects to prevent autonomous cars from hitting them, and therefore IoV devices, including those onboard and installed at fixed locations, are needed for multi-purpose detection to provide real-time warning, Stein indicated.Siemens Mobility has provided many transportation solutions for use in many countries, including ones which combine car plates rcognition with IoV, and those which use SCOOT (split cycle offset optimization technique) algorithm to quickly coordinate traffic signals to give priority to light-rail transit coaches, Stein said, adding such solutions can be used in Taiwan to provide traffic data for government reference in its decision-making.Thomas Stein, CEO of the Taiwan branch of Siemens MobilityPhoto: Shihmin Fu, Digitimes, July 2020

The 5G iPhone may be coming a few weeks later than usual because of COVID-19 impacts, but development for Apple Watch 6 reportedly has been going smoothly, with ASE Technology obtaining a major portion of the backend service orders for the new wearable devices. Pandemic-triggered stay-at-home needs are said to be decelerating, but Acer is confident that demand for Chromebooks will remain robust in the third quarter. LCD panel maker AUO, who saw its loss narrow in the second-quarter 2020, is also upbeat about its business in the third quarter.ASE reportedly grabs major SiP orders for new Apple Watch: ASE Technology has obtained major backend orders for Apple Watch Series 6 slated for launch later this year, according to industry sources.Acer to enjoy robust Chromebook sales in 3Q20: Despite a deceleration in demand from the work-from-home segment, Acer's notebook orders from the education segment, particularly those for Chromebooks, remain robust in the third quarter as educational procurements from North America, Europe, India, Indonesia and Japan are all rising rapidly, according to company chairman and CEO Jason Chen.AUO gives positive outlook for 3Q20: AU Optronics (AUO) has given a positive outlook for third-quarter 2020, citing significant improvements in its business operations and order visibility as well as a recovery of global economic activities.

Smartphone shipments to the China market more than doubled sequentially in second-quarter 2020 following a period hard hit the coronavirus pandemic earlier in the year, according to Digitimes Reseach's latest findings. But the market still faces economic uncertainties, smartphone shipments to China will shrink in the third quarter. In the semiconductor sectgor, pure-play foundry UMC has disclosed that inventory replenishment is continuing across multiple market segments in the wake of COVID-19-induced supply chain disruptions. For LCD panel maker AUO, its second-quarter finances improved, with revenues going up and loss narrowing, both sequentially, thanks to stay-at-home demand.China smartphone shipments to contract in 3Q20, says Digitimes Research: Smartphone shipments to the China market are expected to decline both sequentially and annually in the third quarter of 2020, after experiencing a robust on-quarter growth in the previous quarter, according to Digitimes Research.UMC expects flat 3Q20: Pure-play foundry United Microelectronics (UMC) expects its wafer shipments and ASPs to stay flat sequentially in the third quarter of 2020, with its capacity utilization rate remaining high at about 95%.AUO loss narrows in 2Q20: AU Optronics (AUO) has reported net loss of NT$2.96 billion (US$100.99 million) for second-quarter 2020, an improvement from net loss of NT$4.99 billion for th eprevious quarter.

Smartphone shipments to the China market are expected to decline both sequentially and annually in the third quarter of 2020, after experiencing a robust on-quarter growth in the previous quarter, according to Digitimes Research.Smartphones sales in China surged 104.6% sequentially in the second quarter thanks to the easing of the coronavirus impacts, economic stimulus measures and the launch of new hanset models, Digitimes Research has found.Second-quarter smartphone shipments in China also represented a mild 1.4% growth from a year earlier.Huawei, Vivo, Oppo, Xiaomi and Apple were the top-five handset vendors in China in the second quarter, with their combined market share reaching 98.1%, up 1.4pp from a quarter earlier.As the current strength of components pull-ins by Chinese handset brands is not as strong as expected for the third-quarter traditional peak season and the effects of some stimulus measures are beginning to wane, smartphones shipments in China are expected to contract 7.9% on year in the third quarter, Digitimes Research estimates.But shipments from Huawei are expected to remain robust in the third quarter, allowing the vendor to eventually take up a nearly 50% market share in the third quarter.

There are many social networking platforms, but they have been unable to fill the very gap left wide open by the ongoing coronavirus pandemic that has been barring people from face-to-face physical interactions.Virtual reality (VR) may be the best option, enabling interactions almost as real and conveying emotions much better than just words, stickers and voices, according to XRSpace president Sting Tao, who recently talked to Digitimes in an interview.Q: How do you view development of social platforms amid the coronavirus pandemic?A: As the pandemic has separated people and restricted social activities, lack of face-to-face social interactions has made life lonely and uncomfortable despite communication via the phone and messaging apps.Interactions come in various forms: verbal expressions, emojis, and face-to-face physical meetings. More real interactions can lead to more emotional satisfaction.VR technology features immersive experience and along with 5G connectivity, gesture-based operation and technological development of virtual personification (avatar) can bring brand-new experience for social application.Q: In terms of social platforms, what has changed and what remains unchanged?A: Since social platforms are for interactions among people, the ability to convey expressions, emotions and feelings is the core value that cannot be changed. There are different ways of expression enabled by different technologies, but the key is faithful transmision of the messages and feelings.XRSpace thinks that VR bring better experience in emotional exchange and thus will become the technological mainstream in social application. In a bid to keep upgrading its XRSpace Manova, XRSpace has been constantly asking itself: Can our new services meet users' demand? Can the new functions make users feel easy to use and want to use them every day?Q: While other VR platforms focus their applications on entertainment, education, training or industrial purposes, why does XRSpace focus on social networking?A: VR gaming is exciting and VR video is interesting, but such applications lack emotional connection, making VR merely an entertainment tool and commercially a production tool.For emotional connection, VR cannot be used to only entertain individual users and instead has to enable individual users to connect with others.XRSpace Manova enables users to interact with their favorite characters from movies or animations. There can be other virtual scenarios where company managers, fitness coaches, teachers or tour guides can interact with the users.XRSpace has Manova-specific revenues coming from three sources: Sales of Manova hardware; sales of virtual items; sharing of revenues from partners marketing on the Manova platform. XRSpace will develop an online transaction mechanism on Manova for partners to sell online videos, educational courses, and tickets for concerts and sports events, etc. XRSpace will provide tools and management functions to help partners develop software, content and services on Manova.XRSpace president Sting TaoPhoto: Michael Lee, Digitimes, July 2020

HwaCom Systems, a Taiwan-based provider of system integration services, will be in charge of an experimental field for testing 5G IoV-based smart transportation solutions, according to company chairman and president Gary Chen.Under the transport ministry's planning, HwaCom will cooperate with the Taiwan branch of Germany-based Siemens Mobility and several local transportation research organizations, universities and enterprises to set up the experimental field in Tanhai New Town in northern Taiwan, Chen said.The experimental field is intended to become a framework for mutual Internet-based communications among vehicles, roads, people and networks, Chen said. HwaCom will match smart transportation solutions with the experimental field, enabling startup developers of such solutions to test technological and commercial feasibility of their ideas, Chen noted.As developers of smart transportation solutions may have difficulties accessing testing resources, HwaCom will simplify the application process for developers looking to use the experimental field, Chen indicated.Being a supplier of IoV equipment for the experimental field, Siemens Mobility will provide roadside and in-car C-V2X devices, road controllers such as smart traffic lights and Omniflow smart street lamps, said Thomas Stein, CEO of Siemens Mobility's Taiwan branch. Autonomous cars will share the use of roads with conventional cars and this will pose big challenges to IoV, Stein noted.The field will start operation in January 2021, said HwaCom.Tanhai New Town in Northern TaiwanPhoto: HwaCom Systems

Taiwan is becoming a hub for the server industry, with HPE, currently th esecond largest server brand worldwide, reportedly planning to move its server hardware R&D resources to Taiwan. In the PC sector, demand for Microsoft Surface devices is picking up thanks to growig stay-at-home economy. Judging from components orders, Microsoft Surface device shipments are expected to 30% growth in 2020. In the Apple supply chain, Chinese firm Luxshare reportedly is making aggressive moves, looking to become the top assembler for the iPhone.HPE reportedly to move server R&D to Taiwan: Hewlett Packard Enterprise (HPE) is reportedly planning to shift its server hardware R&D resources to Taiwan and is scaling down its existing operations in Houston, according to industry sources.Protective component makers see additional orders for Microsoft Surface series: Following a wave of rush orders in April-May, Taiwanese suppliers of protective components for notebooks and tablets have seen orders pick up again starting July, as brand vendors including Microsoft have moved to place additional orders to support increased shipments for remote work and education applications in the second half of the year, according to industry sources.Luxshare aims to lead in iPhone supply chain, say sources: With the acquisition of Wistron's plants in China, Luxshare aims to take over Foxconn's position as the largest iPhone manufacturer, according to sources from the upstream supply chain.